| A | B |
|---|
| Compound interest | Earning interest on interest |
| Consumption | The purchase of goods and services |
| Do it yourself | When you complete a task yourself rather than paying someone else |
| Emergency savings | Cash set aside to cover the cost of unexpected events |
| Interest | Price paid for using someone else’s money |
| Interest rate | Percentage rate used to calculate interest |
| Liquidity | How quickly and easily assets can be accessed and converted into cash |
| Pay yourself first | Saving for the future by putting money aside before paying regular monthly bills or using income for discretionary purchases |
| Principal | The original amount of money saved or invested |
| Saving | Accumulation of excess funds by intentionally spending less than you earn |
| Savings | Portion of income not spent on consumption |
| Time value of money | Money available at the present time (today) is worth more than the same amount if received in the future |
